What Do You Think? Should banks look at principal reductions for underwater loans?

Some banks are reconsidering the idea that forgiving principal on underwater loans may be the best way to deal with our high rate of short sales and foreclosures. This may offer the best incentive for borrowers to continue to make their monthly mortgage payments instead of just walking away from their loan. My question-do you think this is fair especially to the people who have been making their monthly mortgage payments or are we all going to have to give a little to get the housing market back on track?